i am trying to switch a 12v current on and off using a 4n25 optocoupler.

12v are hooked up to the collector - but when i turn on the diode - the emitter will only give me around 5 volts. i tried switching power supplies, even gave it 24v, which resulted in a 7v output from the emitter...

i have a digital pin connected to a 220ohm resistor to the anode, cathode goes to arduino ground.

i don't think the resistor between the arduino and the 4n25 is too big, the led should light up nicely... so where is all my current going?

Well it is better. However if you have an 8R load then you are going to be shipping a fair bit of current into the amplifier.You can try that but you are likely to get a bit of voltage drop with that arrangement. Measure the voltage at pin 6 with a meter when you turn it on.I would also have a large capacitor of > 100uF across the supply of that amplifier.